Development of stem cell technologies for cell replacement therapy has progressed rapidly in recent years. Diabetes has long been seen as one of the first applications for stem cell–derived cells because of the loss of only a single cell type—the insulin-producing β-cell. Recent reports have detailed strategies that overcome prior hurdles to generate functional β-like cells from human pluripotent stem cells in vitro, including from human induced pluripotent stem cells (hiPSCs). Even with this accomplishment, addressing immunological barriers to transplantation remains a major challenge for the field. The development of clinically relevant hiPSC derivation methods from patients and demonstration that these cells can be differentiated into β-like cells presents a new opportunity to treat diabetes without immunosuppression or immunoprotective encapsulation or with only targeted protection from autoimmunity. This review focuses on the current status in generating and transplanting autologous β-cells for diabetes cell therapy, highlighting the unique advantages and challenges of this approach.